Data on North Carolina hospital charges

Published: Saturday, May 11, 2013 at 4:30 a.m.

Last Modified: Wednesday, May 8, 2013 at 4:03 p.m.

Some hospitals charge vastly more for same care

CONNIE CASS,Associated Press

LAURAN NEERGAARD,Associated Press

WASHINGTON (AP) — Hospitals within the same city sometimes charge tens of thousands of dollars more for the same treatment, according to figures the government released publicly for the first time Wednesday. The federal list sheds new light on the mystery of just how high a hospital bill might go — and whether it's cheaper for uninsured patients to get the care somewhere else.

But it doesn't answer the big question: Why do some hospitals charge 20 or even 40 times more than others?

"It doesn't make sense," said Jonathan Blum, director of the government's Center for Medicare. The higher costs don't reflect better care, he said, and can't be explained by regional economic differences alone.

Blum said he hopes making the information available without charge to the public will help generate answers to the riddles of hospital pricing, and put pressure on the more expensive hospitals.

The fees that Medicare pays hospitals aren't based on their charges, Blum said. But patients who are without government or private medical coverage are subject to them. The new information should help those patients decide where to get care, he said.

There are vast disparities nationally. The average charges for joint replacement range from about $5,300 at an Ada, Okla., hospital to $223,000 in Monterey Park, Calif.

It's not just national or even regional geography. Hospitals within the same city also vary wildly. In Jackson, Miss., average inpatient charges for services that may be provided to treat heart failure range from $9,000 to $51,000, the Department of Health and Human Services said.

Hospitals usually receive less money than they charge, however. Their charges are akin to a car dealership's "list price." Most patients won't be hit with these bills, because they are paid by their private insurance, Medicare or Medicaid at lower rates. Insurance companies routinely negotiate discounted payments with hospitals.

"These charges really don't have a direct relationship with the price for the average person," said Chapin White of the nonprofit Center for Studying Health System Change. "I think the point is to shame hospitals."

The charges do show up on the bills of people without medical coverage, many of whom try to negotiate smaller fees for themselves. And they could affect people paying for care that is outside their insurance company's network. Hospitals say they frequently give the uninsured discounts.

"This is the opening bid in the hospital's attempt to get as much money as possible out of you," White said of the listed charges.

And some people pay full price, or try to afford it, because they don't know they can bargain for a discount, White said.

The department released a list of the average charges at 3,300 hospitals for each of the 100 most common Medicare inpatient services. The prices, from 2011, represent about 60 percent of Medicare inpatient cases.

"Hospitals that charge two or three times the going rate will rightfully face scrutiny," Health and Human Services Secretary Kathleen Sebelius told reporters.

And consumers will benefit from more information about a mystifying system that too often leaves them with little way of knowing what a hospital will charge or what their insurance companies are paying for treatments, Sebelius said.

Previously, the price information that the government collects from hospitals wasn't available to the average consumer, although the data could be purchased for uses such as research, officials said.

The department also is making $87 million in federal money available as grants to states to improve their hospital rate review programs and get more information about health care charges to patients.

Study Population: Medicare Inpatient Prospective Payment System (IPPS) providers within the 50 United States and District of Columbia with a known Hospital Referral Region (HRR) who are billing Medicare fee-for-service beneficiaries for the top 100 DRGs. The top 100 DRGs are determined by the number of discharges.

Years: Fiscal Year 2011

Geographic Variables: The provider's address including street, city, state abbreviation and zip code and the Hospital Referral Region (HRR) based on the providers zip code. HRRs were developed by the Dartmouth Atlas of Health Care to delineate regional health care markets in the United States (http://www.dartmouthatlas.org/).

Spending Measures: We present the provider's average total covered charges and average total payments within DRG. Total payments consist of Medicare payments, beneficiary cost-share payments, and coordination of benefit payments.

Utilization Measures: We present the total number of discharges billed by the provider within DRG.

Limitations of Maryland Data: The state of Maryland has a unique waiver that exempts it from Medicare's prospective payment systems for inpatient care. Maryland instead uses an all-payer rate setting commission to determine its payment rates. Medicare claims for hospitals in other states break out additional payments for indirect medical education (IME) costs and disproportionate share hospital (DSH) adjustments.

Provider Street Address Street address in which the provider is physically located.

Provider City City in which the provider is physically located.

Provider State State in which the provider is physically located.

Provider Zip Code Zip code in which the provider is physically located.

Provider HRR HRR in which the provider is physically located.

Total Discharges The number of discharges billed by the provider for inpatient hospital services.

Average Covered Charges The provider's average charge for services covered by Medicare for all discharges in the DRG. These will vary from hospital to hospital because of differences in hospital charge structures.

Average Total Payments The average of Medicare payments to the provider for the DRG including the DRG amount, teaching, disproportionate share, capital, and outlier payments for all cases. Also included in Total Payments are co-payment and deductible amounts that the patient is responsible for and payments by third parties for coordination of benefits.

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<p>CONNIE CASS,Associated Press</p><p>LAURAN NEERGAARD,Associated Press</p><p></p><p>WASHINGTON (AP) — Hospitals within the same city sometimes charge tens of thousands of dollars more for the same treatment, according to figures the government released publicly for the first time Wednesday. The federal list sheds new light on the mystery of just how high a hospital bill might go — and whether it's cheaper for uninsured patients to get the care somewhere else.</p><p>But it doesn't answer the big question: Why do some hospitals charge 20 or even 40 times more than others?</p><p>"It doesn't make sense," said Jonathan Blum, director of the government's Center for Medicare. The higher costs don't reflect better care, he said, and can't be explained by regional economic differences alone.</p><p>Blum said he hopes making the information available without charge to the public will help generate answers to the riddles of hospital pricing, and put pressure on the more expensive hospitals.</p><p>The fees that Medicare pays hospitals aren't based on their charges, Blum said. But patients who are without government or private medical coverage are subject to them. The new information should help those patients decide where to get care, he said.</p><p>There are vast disparities nationally. The average charges for joint replacement range from about $5,300 at an Ada, Okla., hospital to $223,000 in Monterey Park, Calif.</p><p>It's not just national or even regional geography. Hospitals within the same city also vary wildly. In Jackson, Miss., average inpatient charges for services that may be provided to treat heart failure range from $9,000 to $51,000, the Department of Health and Human Services said.</p><p>Hospitals usually receive less money than they charge, however. Their charges are akin to a car dealership's "list price." Most patients won't be hit with these bills, because they are paid by their private insurance, Medicare or Medicaid at lower rates. Insurance companies routinely negotiate discounted payments with hospitals.</p><p>"These charges really don't have a direct relationship with the price for the average person," said Chapin White of the nonprofit Center for Studying Health System Change. "I think the point is to shame hospitals."</p><p>The charges do show up on the bills of people without medical coverage, many of whom try to negotiate smaller fees for themselves. And they could affect people paying for care that is outside their insurance company's network. Hospitals say they frequently give the uninsured discounts.</p><p>"This is the opening bid in the hospital's attempt to get as much money as possible out of you," White said of the listed charges.</p><p>And some people pay full price, or try to afford it, because they don't know they can bargain for a discount, White said.</p><p>The department released a list of the average charges at 3,300 hospitals for each of the 100 most common Medicare inpatient services. The prices, from 2011, represent about 60 percent of Medicare inpatient cases.</p><p>"Hospitals that charge two or three times the going rate will rightfully face scrutiny," Health and Human Services Secretary Kathleen Sebelius told reporters.</p><p>And consumers will benefit from more information about a mystifying system that too often leaves them with little way of knowing what a hospital will charge or what their insurance companies are paying for treatments, Sebelius said.</p><p>Previously, the price information that the government collects from hospitals wasn't available to the average consumer, although the data could be purchased for uses such as research, officials said.</p><p>The department also is making $87 million in federal money available as grants to states to improve their hospital rate review programs and get more information about health care charges to patients.</p><p>Inpatient Prospective Payment System (IPPS) Provider Level Charges and Medicare Payments for the Top 100 Diagnosis-Related Groups (DRG) </p><p>Methods </p><p>Data Source: CMS Medicare Provider Analysis and Review (MEDPAR) inpatient data which contains discharge information for 100% of Medicare fee-for-service beneficiaries using hospital inpatient services. </p><p>Study Population: Medicare Inpatient Prospective Payment System (IPPS) providers within the 50 United States and District of Columbia with a known Hospital Referral Region (HRR) who are billing Medicare fee-for-service beneficiaries for the top 100 DRGs. The top 100 DRGs are determined by the number of discharges. </p><p>Years: Fiscal Year 2011 </p><p>Geographic Variables: The provider's address including street, city, state abbreviation and zip code and the Hospital Referral Region (HRR) based on the providers zip code. HRRs were developed by the Dartmouth Atlas of Health Care to delineate regional health care markets in the United States (http://www.dartmouthatlas.org/). </p><p>Spending Measures: We present the provider's average total covered charges and average total payments within DRG. Total payments consist of Medicare payments, beneficiary cost-share payments, and coordination of benefit payments. </p><p>Utilization Measures: We present the total number of discharges billed by the provider within DRG. </p><p>Limitations of Maryland Data: The state of Maryland has a unique waiver that exempts it from Medicare's prospective payment systems for inpatient care. Maryland instead uses an all-payer rate setting commission to determine its payment rates. Medicare claims for hospitals in other states break out additional payments for indirect medical education (IME) costs and disproportionate share hospital (DSH) adjustments.</p><h3>Key</h3>
<p>DRG Summary for Medicare Inpatient Prospective Payment Hospitals, FY2011 </p><p>Top 100 DRGs Based on Total Discharges </p><p> </p><p>Note: Includes discharges from Hospitals located within the 50 United States and District of Columbia </p><p>Hospitals with fewer than 11 discharges within a DRG have been suppressed for that DRG </p><p></p><p>Medicare Payments for the Top 100 Diagnosis-Related Groups </p><p></p><p>Inpatient Prospective Payment System (IPPS) Provider Level Charges and Medicare Payments for the Top 100 Diagnosis-Related Groups (DRG) </p><p>Documentation </p><p>Short Name Description </p><p>DRG Code and description identifying the DRG. DRGs are a classification system that groups similar clinical conditions (diagnoses) and the procedures furnished by the hospital during the stay. </p><p>Provider Id Provider Identifier billing for inpatient hospital services. </p><p>Provider Name Name of the provider. </p><p>Provider Street Address Street address in which the provider is physically located. </p><p>Provider City City in which the provider is physically located. </p><p>Provider State State in which the provider is physically located. </p><p>Provider Zip Code Zip code in which the provider is physically located. </p><p>Provider HRR HRR in which the provider is physically located. </p><p>Total Discharges The number of discharges billed by the provider for inpatient hospital services. </p><p>Average Covered Charges The provider's average charge for services covered by Medicare for all discharges in the DRG. These will vary from hospital to hospital because of differences in hospital charge structures. </p><p>Average Total Payments The average of Medicare payments to the provider for the DRG including the DRG amount, teaching, disproportionate share, capital, and outlier payments for all cases. Also included in Total Payments are co-payment and deductible amounts that the patient is responsible for and payments by third parties for coordination of benefits.</p>